SWP 26/87 CORPORATE LEADERS IN BRITAIN AND AMERICA …points. Farmer f Richman(l985) adopted an...

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llllll III Ill II II 1111111111111 lllllll l/Ill 1402710938 SWP 26/87 CORPORATE LEADERS IN BRITAIN AND AMERICA A CROSS-NATIONAL ANALYSIS PROFESSOR DAVID NORBURN Professor in Strategic Management Cranfield School of Management Cranfield Institute of Technology Cranfield Bedford MK43 OAL United Kingdom (Tel: 0234-751122) (Fax: 0234 751806) Copyright: Norburn,

Transcript of SWP 26/87 CORPORATE LEADERS IN BRITAIN AND AMERICA …points. Farmer f Richman(l985) adopted an...

Page 1: SWP 26/87 CORPORATE LEADERS IN BRITAIN AND AMERICA …points. Farmer f Richman(l985) adopted an external environmental approach and drew attention to the constraints upon managerial

llllll III Ill II II 1111111111111 lllllll l/Ill 1402710938

SWP 26/87 CORPORATE LEADERS IN BRITAIN AND AMERICA A CROSS-NATIONAL ANALYSIS

PROFESSOR DAVID NORBURN Professor in Strategic Management

Cranfield School of Management Cranfield Institute of Technology

Cranfield Bedford MK43 OAL

United Kingdom

(Tel: 0234-751122)

(Fax: 0234 751806)

Copyright: Norburn,

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CORPORATE LEADERS IN BRITAIN AND AMERICA

A CROSS-NATIONAL ANALYSIS

ABSTRACT

This study tested for the extent of similarity between 1708 American

senior vice-presidents and those of 418 British counterparts. The

sample was drawn from the Fortune 500 and the Times 500, being

representative of the top management teams of the largest national

companies dominating domestic economies.

Results show substantial differences between American and British

top management in terms of corporate lfgrooming@l, educational and

domestic experiences, and in self-concept with regard to aspiration

levels and executive success traits.

The findings of this research should have significance to scholars

of overseas investment patterns; to U.S. and U.K. companies

considering acquisitions in each other's countries; to top

management evaluating managerial compatibility in potential

U.S./U.K. joint ventures: and to those companies seeking competitive

advantage in each other's domestic markets.

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CORPORATE LEADERS IN BRITAIN AND AMERICA

A CROSS-NATIONAL ANALYSIS

INTRODUCTION

Early empirical investigation in the field of strategic management,

focused upon the formulation of appropriate strategy (see Hofer

t Schendel, 1978). As knowledge advanced, strategic typologies were

developed and were related to alternative organisational structures

(Chandler, 1962: Scott, 1971; Wrigley, 1971; Channon, 1974). This

has been extended to.the management of the strategic process (Peters

& Waterman, 1982), and to top management selection consistent with

the chosen strategy (Norburn & Miller, 1981; Leontiaides, 1982).

Yet the impact of the actual qualities and characteristics of top

management, considered by Buzzell, Gale 61 Sultan (1975) to be a

major explanatory factor in determining financial variability within

their original Profit Impact of Market Strategies (PIMS) study,

received little support during the 1970's. Indeed, both Hannan

& Freeman (1977), and Pfeffer & Salancik (1978) contended that the

impact of top managers upon organisational performance was minimal.

However, possibly due to more turbulent trading conditions,

contemporary alternative theory development has propounded that top

management effects a more positive role, culminating in the "upper- '

echelonI* theory of Hambrick & Mason (1984). This contends that the

characteristics of the top management team,(TMT) will be a partial

predictor of organisational performance between competing companies.

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Whereas elements of their theory have been supported empirically

within US crisis companies (Hambrick f DlAveni, 1985) or across

domestic UK industry sector performance (Norburn, 1986), as yet no

data has emerged at the TMT level on a cross-national, multi-company

basis.

A focus for testing this extension is provided by the intensity of

transatlantic commercial activity between Great Britain and the

United States, for within the last five years, the exchange rate has

varied between fl - $2.43 and fl = $1.05, a situation which has

caused each country in turn to become extremely attractive as a

location for commercial activity (Group of 30, 1984). This has

taken a number of forms - a strategic stockholding (General Motors/

British Leyland), joint-venture (Rolls Royce/Boeing), start-up

(Herman Miller), or outright acquisition (Hanson/SCM). However,

sufficient examples exist, albeit anecdotal, to suggest that

successful implementation of these cross-national strategies by

local management may have been constrained by the assumption on the

part of the controlling corporation that top management

characteristics are similar. For example, the Midland Bank/Cracker

V1embarrassmentll, or the Howard Johnson/Imperial Group debacle, both

acquisitions having been recently divested upon a criterion of

managerial incompatibility. If TMT differences do exist between the

two nations across a wide section of companies, modification of

strategic implementation to encompass these variations may well be

suggested. Further, in the more competitive circumstances of an

uninvited bid or entry into domestically dominated oligopolistic

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industries (e.g., US steel industry: UK dairy processing industry),

support will be given to Tuckman's (1984) argument, that knowledge

of defending managements' characteristics which affect strategic

positioning is crucial.

This research, therefore, tests for the extent of similarity between

British and American top managers, its major proposition being that

in terms of corporate lVexperiences", domestic and educational

influences, and in personal beliefs with regard to managerial

success traits and aspiration levels, significant dissimilarity will

be demonstrated. Should this proposition be supported, its findings

should have significance to scholars of inward and outward

investment: to U.S. and U.K. companies considering acquisitions in

each other's countries: to top management evaluating managerial

compatibility in potential U.S./U.K. joint ventures: and to those

companies seeking competitive advantage in each other's domestic

markets.

LITERATURE REVIEW

The very lack of knowledge with regard to TMT characteristics,

particularly on a cross-national basis, necessitates the weaving

together of a number of strands of literature from different

starting-points, but which impinge upon corporate leadership: those

which concentrate upon the process of management in International

Business; those which consider factors external to the company from

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a Cross-Cultural perspective: and those from the area of Military

Warfare.

Most top management studies in the area of International Business

have been both unicultural and North American (see Sekaran, 1983:

Adler, 1983(a)), and have concentrated upon the process of decision-

making, not upon the decision-makers themselves. Where studies, have

been conducted outside the United States, the choice of country

appears to be influenced by perceived atypicality, for example, a

distinct counterpoint to US domestic managerial practice is

illustrated by studies of Japanese management (Pascale, 1981:

MacMillan, 1982).

The paucity of comparative research between the U.S. and the U.K. as

to top management characteristics may therefore suggest that a

perception of similarity exists. In support of this assumption

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Child (1981) states that UX and that US organisation structures have

already merged in similarity across cultures, a proposal supported

in these two countries by the earlier national studies of Wrigley

(1971) I and Channon (1974). Despite this momentum, however,

research into the knowledge of the comparative characteristics of

the corporate themselves is minimal. It is important, therefore to

consider the caveat of Negandhi (1983) who, in his review of the

extent of current knowledge with regard to Cross-Cultural studies,

warns that existing evidence lies within the "twilight zone".

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Contributions to theory have emanated from different starting

points. Farmer f Richman(l985) adopted an external environmental

approach and drew attention to the constraints upon managerial

influence by the socio-economic, political, legal and technological

factors. To them, managerial practices are a function of external

forces. In counterpoint, Boddewyn (1966), although acknowledging

the significance of environmental factors, warns of the danger in

considering top management to be but passive agents, and "of letting

the environment crowd the comparative analysislQ.

A third perspective is advanced by those who adopt a behavioral

approach contending that managerial attitudes, values, and beliefs

are functions of a national culture (see Nath, 1969: Davis, 1971), a

view supported by Hofstede's (1980) empirical investigation into

employee attitudes within a single giant multi-national corporation

across 50 countries.

A fourth perspective is suggested by Negandhi (1983) who warns of

the dangers in assuming that managerial characteristics are

different for different cultures. He considers such factors as

corporate size, location, and market complexity to be at least

equal, if not more influential than national culture, an observation

supported by the PIMS methodology (see Schoeffer, Buzzell & Heany,

1974).

Concentrating upon methodological issues in cultural investigation,

Adler's (1983(a)) analysis revealed that 80% of the 11,000 articles

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published in 24 management journals in the last decade were studies

of the United States by Americans. From this understanding she

developed a comprehensive typology of cross-cultural management

research and delineated six approaches (Adler, 1983(b)). Of

significance for this research, she stressed that for comparative

studies one should search for both similarities and differences,

labelling emergent similarity as universality, and emergent

difference as cultural specifity. Her conclusion of tension between

the current methodological superiority of traditional unicultural

studies, and the impatience to develop rigorous multinational

studies appears a sensible warning for an area of studies in the

early stages of its development. For these reasons, and those of

Ajiferuke t Boddweyn (1970), and Roberts (1970) who both note that a

single definition of culture has yet to be agreed by management

scholars, this research does not claim to be a rigorous cross-

cultural study, but more a cross-national analysis mindful of the

dangers of ethnocentric interpretation.

Moving outside of a commercial context, it would seem that the

science of Military Warfare could, parenthetically, provide useful

parallels for corporate investigation. Military practitioners in

conventional warfare obtain success through assiduous analysis of

terrain, topography, force deployment, and in particular, the

characteristics of the opposing commander-in-chief. By relating

this data to their strengths, military leaders are able to determine

who to fight, whether to fight, when to fight, and with what

resources. It becomes a strategic, tactical and operational

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paradigm. * This analogy between military warfare and product-market

positioning has not gone unnoticed: increasingly, references to the

battles of Sun-Yet-Sen, Seneca, Washington, Napoleon, Clauswitz,

Haig are to be found in recent strategy articles (Rotler & Anchrol,

1981: Ginter & Rucks, 1984: Birley & Norburn, 1984). In military

strategy, it is erroneous not to evaluate the characteristics of

opposing generals, yet in strategic management, the behavioural

characteristics of competing top managers - the aenemytt - as a

predictor of strategic choice is, in corporate terms, an under-

researched area.

THIS RESEARCH

Research Proposition:

From the literature review above it seems evident that knowledge as

to TMT characteristics at a cross-national level is, to use Adler's

(1983 (b)) adjective, at best ltmurkytq. What is known tends to be

either unicultural, or is single company based, or concerns few

variables, or has been conducted at lower echelons within corporate

hierarchies. In order to advance, this research adopts an

exploratory and wider approach, leading to the following broad

research proposition:

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Corporate leaders at the TMT level within the largest US and UK companies will have been

exposed to dissimilar influencing factors and demonstrate significantly different managerial

characteristics.

Hypotheses and Variables:

Within this broad statement, the choice of specific top management '

characteristics emanate from the disciplines of Strategic

Management, Organisational Behaviour, and Leadership Studies.

Broadly speaking, these characteristics trichotomise, the

establishment of which is an extension both of Cooper's (1981)

classification of influence groupings upon the genesis of

entrepreneurs, and upon de la Torre 61 Toynels (1978) model of cross-

national fctors influencing managerial attitudes. Cooper separates

antecedent influences, for example genetic factors, family,

education, from incubational factors - those which constrain and

condition managerial development within a corporate context. de la

Torre & Toyne propose two similar groups to Cooper of factors

pertinent to this study in addition to environmental and contextual

factors (e.g. size) not applicable for this research design. To

these two overlapping groups, a third grouping of Self-Concept has

been added, owing much to the situational theorists in Leadership

Studies. The three resultant groups are depicted in Figure 1 below

together with summary sub-sets of the variables tested. They form

the following broad hypotheses without any assumption of equal

weight.

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HI: The TMTs of the largest US and UK companies will demonstrate significantly

different corporate experiences.

H2: The TMTs of the largest US and UK companies will demonstrate significantly

different domestic and educational influences.

H3: The TMTs of the largest US and UK companies will demonstrate a significantly

different self-concept.

Insert Figure 1 about here

, Although a majority of the variables tested within the three groups

emerge from the theoretically more advanced, and older, disciplines

of organisational behaviour and leadership studies, it should be

emphasised that theory-building in strategic management is at an

early stage. Where pertinent, variables from this area are grounded

in previous research: where not, from normative prescriptions within

Business Policy literature. The specific variables tested are seen

in Table 1.

Insert Table 1 about here

HI: The Corporate Environ

Within this section, the chosen variables derive mainly

from conceptual development in Business Policy, and group

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into the three areas of functional track, of the breadth of

company experience, and of workload.

The importance of functional experience and its effect upon

perceptions of different trading environments has been

developed by Lawrence and Lorsch (1973), Hayes and

Abernathy (1980), and by Miles and Snow (1980). Length of

tenure and stability of company performance are linked by

Shetty and Perry (1976), and by Kotter (1982). The

relationship between certain leadership experience and

corporate trading environments is debated by Vroom and

Yetton (1973), Osborn and Hunt (1975), Pfeffer and Salancik

(1978), and by Yukl (1981). Handy (1976), Norburn and

Miller (1981), and Leontiades (1982) all stress the

importance of relating the breadth of managerial experience

in multiple trading conditions to companies adopting

strategic portfolios of both cash-consumptive and cash-

generative strategic strategic business units. Kern/Ferry

(1979) I Sussman (1979), and Heidrick & Struggles (1981,

1982), document and comment upon the increase in workloads

as executives progress to the top of the corporate

hierarchy.

Specific variables were operationalised from the

theoretical development. Width of functional experience

was measured by starting function, predominate career

function, and current function. Breadth of company

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experience was related to company tenure, to international

postings, to the number of companies worked for and the

reasons for moving, and to running their own business.

Workloads were measured by the hourly working work, and to

the number of nights spent away from home on company

business.

H2: The Domestic Environ

Variables tested in this constituency emanate largely from

research in Organisational Behaviour. The conditioning of

managerial attitudes from childhood family experience is

suggested by Collins and Moore (1970), Handy (1976), and by

Hunt (1979). The socio-economic background of senior

executives is catalogued by Burck (1976), and by Sturdivant

and Adler (1976). Stanworth and Curran (1976) extend this

by suggesting a lack of upward social mobility. On both

sides of the Atlantic - in England, Channon (1976), and in

the United States, Collins and Moore (1970), Miner (1975),

and Pfeffer (1981) - type of education is thought to

* predict membership of managerial level. Variables were

therefore operationalised to measure childhood influences -

sibling position; locality: parental guidance and socio-

economic grouping: trauma; current marital situation; and

the level and type of educational achievement.

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H3: Self -Concept

The variables tested within this last section are

predominantly a development of Leadership Research. Bowers

and Seashore (1966), Stogdill (1973), Gordon (1976), Katz

and Xahn (1978) suggest success traits connected with top

management levels. Further, Bray, Cambell and Grant (1974)

consider the influence of the first boss to be reflected

within those success traits. Leaders will demonstrate high

achievement needs (McClelland (1965, 1975); Wainer and

Rubin (1969); Donley and Winter (1970); Hundal (1971);

Miner (1975)). Leaders will exhibit distinct managerial

styles (Ohio studies (1950's); Michigan studies (1950's);

Lickert (1961, 1967); Bowers and Seashore (1966)).

Building upon the leadership concept of style, the

situational theorists contend that different styles will be

identified relative to different conditions (Fiedler,

1965; House, 1971; Crowe, Bucker and Clark, 1972; Vroom and

Yetton, 1973; Hersey and Blanchard, 1977; Yukl, 1981).

Youthfulness has been related to risk propensity (Child,

1974) and to the ability to consider commercial solutions

from a wider set of options (Hart and Mellons, 1970). From

these sources, variables were operationalised to measure

ambition, need for achievement, challenge, career

replication and managerial style, in addition to personal

habits and religious affiliation, and age.

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Top Management Population:

Despite the debate as to the origin of strategic formulation within

the organisational hierarchy (Norburn & Miller, 1981: Leontiades,

1982), the importance of top management in the choice of strategy is

argued strongly by Hambrick C Mason, (1984). Further, Buzzell, Gale

& Sultan (1975), and Katz & Kahn (1978) argue that the

organisation's leaders are a major determinant of its strategic

success. But what constitutes top management in cross-national

comparative analysis?

In both the US and UK, the Board of Directors form the apex of the

organisational pyramid. Yet despite both countries adopting a

unitary model, unlike the two-tier ttMitbestimmungtl structure of many

continental European States, it would be erroneous to compare at

this level. In the United States, some 65% of directors are

external (Vance, 1983) whereas in the United Kingdom it is the

internal directors who form the majority (Heidrick & Struggles,

1983). In this research, US top management was defined as senior

vice-presidents with full-time executive responsibility. It does

not include directors from US Boards who were part-time. To ensure

direct comparability, the UX sample in turn excluded all 'part-time

directors. The combined population is therefore directly

accountable for strategic success or failure from a base of full-

time employment within that one company.

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Sekaran (1983) summarises the dangers inherent in cross-cultural

studies, in particular the problems of ensuring functional

equivalence (Sechrest, Fay & Zaidi, 1972), linguistic interpretation

(Mitchell, 1969), and the transferability of US concepts to other

cultures (Sekaran b Martin, 1982). In this study, the choice of

senior executives at the top management level; their use of English

as a common language; and the transfer of management concepts

through business schools and through international trade, should

mitigate against major false comparisons.

Sample:

US data was obtained from a survey by Kern/Ferry (1979) of America's

500 largest companies (Fortune 500) at the level of senior vice-

president. A stratified sample of 3,640 executives was identified

to ensure adequate representation of functional areas, and 1,708

valid questionnaires were returned, a response rate of 47%. The

following year (1980), the same information was obtained by this

author using identical questions via a self-administered

questionnaire from UX senior executives who responded from a similar

stratified sample of the largest 500 British companies (Times 500).

Within this, 450 companies could be identified for comparable

purposes and, of the 1800 executives targeted, 418 valid responses

were received, a response rate of 23%. The response rate, although

lower than that of the US survey, compares favourable with UK

studies at the TMT level, (see Grinyer & Norburn, 1975: Birley,

1976). For the UX study, responding companies covered 18 of the 20

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Standard Industrial Classification sectors (SICs) contained in the

Times 500 thus indicating, in terms of industrial representation,

that no prima facie evidence of atypicality should be suspected.

The percentage of industrial to non-industrial companies

approximated 60/40 in both samples, and were similar therefore in

comparative size within their domestic economics, technology and

market concentration ratios (oligopolistic dominance). The warnings

of Negandhi (1975) and Child (1981) as to the dangers of assuming

different cultures in different countries without considering those

corporate similarities above, were thus incorporated within the

cross-national design. Age distributions for both samples were

fairly similar, but remuneration levels differed strongly. Mean

levels of remuneration were $116,000 in the US, compared to a lowly

f35,OOO (approximately $70,000 at 1980 exchange rates) in the UK - a

point of considerable potential friction in the attempt to

centralise salary structures after Anglo-American acquisitions or

joint-ventures.

Data collected and Statistical method:

The data collected covered 40 variables and is shown in Table 1.

Univariate tests of analysis were conducted to compare the items of

the two populations. For metric data it was not possible to assume

that the two distributions were distributed normally, and the

standard deviations of the populations were unknown. However, given

the large size of both samples, the central limit theorem was used

and the two populations considered to be asymptotically normal. For

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. metric data, the standardised z statistic was utilised and for non-

metric data, the chi-squared test of homogeneity.

Data from the two groups of Corporate, and Domestic environs was

essentially factual. Where responses were judgemental, particularly

within the third group of Self-Concept, scales were drawn from the

literature referenced earlier in this paper. Statistical results

are presented in Tables 2, 3, and 4.

RESULTS

The overall proposition that US and UK managers would exhibit

dissimilarity over a wide range of characteristics and influences

received strong support. Of the 40 variables subjected to analysis,

some 32 (80%) demonstrate a statistically significant difference but

with disparate degrees of dichotomy in the three broad categories of

Corporate, Domestic, and Self-Concept. Results presented in each

category correspond to the summary headings depicted in Figure 1.

Corporate Factors. HI: The TMTs of the larges; US and UK companies will demonstrate

significantly different corporate experiences.

Table 2 illustrates the complete dissimilarity between the TMTs of

the two nations, giving total support to the hypothesis HI.

Analysis from all 14 variables demonstrates a significantly

different result, 13 at the 0.01 level.

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Insert Table 2 about here

The UX top manager demonstrates a shorter tenure with his current

company than does his US counterpart (Means: UX, 17 years: US, 19

years) and has been employed by more companies (Means: UX, 2.95; US,

2.58). In determining the major reasons for changing companies, the

US manager rates increased responsibility relative to peer group

highly: conversely, the UX manager is more likely to change

companies for remuneration improvement combined with a perception of

increased personal challenge.

In terms of functional experience, the entry-point for both sets was

significantly different. Using Hambrick and Mason's (1984)

classification, UK TMTs were more likely to have begun their careers

within "out-put IV functions (e.g. Marketing) than the Vhrough-put"

functions (e.g. accounting) of their US counterparts. But whereas

the US manager stays within that entry-function, the UX manager

moves on early into additional functions before assuming general

management responsibility. The US top manager is therefore more

likely to have experienced a greater concentration of specialisation

within one function, whereas the UX manager has been exposed to a

greater number of multi-functional problems, probably requiring

strategic and tactical trade-offs. In addition, the UK manager is

much more likely to have operated within an international trading

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context, thus broadening his exposure of cross-national commercial

situations.

The caricature of the British businessman portrayed in the US is one

in which he arrives at the office after a leisurely breakfast and

leaves for his club after lunch. This caricature seems overstated

for the UK manager works longer weekly hours than his US

counterpart, a workload which has increased over the last decade

(Norburn, 1986), (Means: UK, 53 hours; US, 51 hours). Conversely

the UX managers takes longer holidays (Means: UX, 3.77 weeks; US,

3.33 weeks), spends fewer nights away on business (Means: UX, 47;

us, 501, and has experienced fewer relocations with his current

company (Means; UK, 1.98: US, 2.1).

Domestic Factors. Hz: The TMTs of the largest US and UK companies will demonstrate

significantly different domestic and educational influences.

Strong support was given to the Hypotheses Hz: of the twelve

variables constituting this section, nine (75%) delineated between

the two sets of managers, eight at the 0.01 level.

Insert Table 3 about here

In terms of education experiences, achievement of a university

degree was distinctly higher within the US business community, since

87% of top US managers graduated at first degree level, compared to

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54% of UX managers. However, of those with degrees, the British

manager was more likely to have studied science than arts, whereas

his American counterpart showed a two to one liberal arts majority.

Although the US manager was more likely to continue his studies

beyond the undergraduate level than his British counterpart, both

managerial sets who had studied further showed similar emphasis on

business education in the proportions of MBA achievement at the

post-graduate level of attainment (45%).

Domestically, top managers in both countries experienced very little

domestic trauma in terms of parental divorce or of their own, the

rate (10%) being less than one third of the two national averages.

Where marital trauma was experienced, that of the US manager

emanated from spouse morbidity, whereas the UX manager was more

likely to be divorced or'beparated.

Yet the difference in parental occupations was marked. The UX

manager came from l@professional@q, non-business stock, (U.K. = 62%:

U.S. - 45%)whereas the US manager was more likely to have parents

with blue-collar occupations (U.K. = 2%: U.S. = 21%). Additionally

18% of US managers had parents who ran their own business in sharp

contrast to the UK manager, not one of whom came from a small

business family background.

Self -Concept. H3: The TA4Ts of the largest US and UK companies will demonstrate

a significantly different self-concept.

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Support was given to hypotheses H3, but at a weaker level than that given to HI and Hz. Of the fourteen variables contained within this

section, nine (64%) delineated between the TMTs, seven at the 0.01

level.

Insert Table 4 about here

Concerning TMT views on occupational matters, the US manager appears

well satisfied at having achieved the upper echelon of management.

His aspirations to further occupational advancement are low. Not so in the UK, for the British manager still aspires to further

advancement within the Boardroom, or with another company.

This same divergence continues in respect of retirement. The US manager would be happy to continue at the same job beyond statutory

retirement, and would embrace the same career if free to start

again. Conversely, the UX manager would pursue a different, but

related career and would be pleased to pursue this if early

retirement was possible.

In reviewing the values of their organisation, top managers were

asked to identify those traits which enhanced an executive's chances

for success. Considerable differences emerged dichotomising upon

the importance of the individual, and the importance of the group.

To the American manager, concern for people commensurate with

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personal integrity emerged strongly, factors of middling importance

to the British manager. Conversely, high personal intelligence was

thought vital to succeed in Britain, whereas in America intelligence

achieved the penultimate lowest rank. Division also occurred with

regard to the importance of personal ambition, in terms of

replicating their historical career - 51% of U.K. Top Managers would

choose a different career compared to 39% in the U.S.

Consistent with this result, and with the functional experiences

described earlier, the US manager regards it better to remain with

one company in order to achieve promotion to the top level. In

contrast, the British manager considers ltjob-hoppingll to be

perfectly respectable, and is more inclined to use the network of

patronage to achieve this.

DISCUSSION

The total extent of dissimilarity between the top managers of the

two nations with respect to corporate factors leads this author to

the view that one set may prosper under certain economic

circumstances whereas the other might not. Taken overall, results

in this section give broad support to those scholars who relate

certain corporate experiences to certain trading conditions (e.g.,

Vroom & Yetton; 1973: Miles 61 Snow, 1980: Leontiades, 1982). The

differences can be interpreted in three broad groups - those

differences concerning inter-, and intra-company mobility, those

concerning functional experience, and those to do with workloads.

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With regard to mobility, UK managers have not only worked for more

companies than the US TMTs but have achieved the upper-echelon at an

accelerated rate. When combined with the major reason for changing

companies - a llpersonal challengel' - it could be argued that the UK TMT would have not only a greater comparative experience of

different corporate cultures and trading conditions, but might

relish the discontinuity. Conversely, the experiences of the US TMT would appear more apposite under trading conditions of steady

growth, supporting the results of Shetty f Perry (1976).

The different functional experiences also support this view. The US TNT is more likely to comprise functional specialists who have

experienced a lesser degree of cross-functional, general management

exposure. This occupational concentration continues at the

international level, the US TMT being far less likely to have

experienced overseas competition. From this, it could be argued

that the US manager would start at a low point on the learning cume

when combating non-domestic competition, and when entering export

markets. His experience is narrow, an observation supporting

Handy's (1976) proposition as to the importance of functional width

in adapting to increases in competitive activity.

Given the widely different proportions of exports as a share of

national output between the two countries - the UK percentage being

nearly three times that of the US - it is not surprising that the

focus of the US manager should be domestic. Yet the 1986 US trade

24

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deficit is forecast to exceed $150b. and when asked to rank "fast-

track" functions for the 1990's, the US manager considers

international exposure to continue to be of a low importance. The

UK manager does not: he strongly emphasises the increasing

importance of this particular experience, viewing the next decade as

one in which commercial success will be the more determined within

an international business arena.

When adding the differences in workload factors, the entire section

of corporate experience demonstrates a condition of dissimilarity.

It would appear that the US manager is treading a well worn path.

He is a functional specialist and domestically orientated in both

inter- and intracompany experiences. In conditions of competitive

inertia, this managerial ngroominglV would cause little concern. Yet

the last decade has seen the decline of US production as a

percentage of world gross national product from 30% to 20% - hardly

a steady-state economic environment.

The genesis of variables within the second Domestic Environ

originate predominantly from US sources, yet results from the

analysis underline the dangers of ethnocentral generalisability (cf.

Collins C Moore, 1970: Miner, 1970). Educational experiences

continued the differences between the two sets, but with a

convergent/divergent pattern. In the US, the TMT received,

predominantly, a general liberal arts education and became a

specialist at the corporate stage of managerial development. The

reverse is seen in the UK. Here the TMT attains a specialist,

25

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usually science-based, degree before rapid promotion from the entry

function to general management responsibility. An interesting research issue is thus raised as to whether a scientific education

is more likely to focus top management's priorities upon strategic

advantage. Mintzberg (1976) has argued that strategic planning

emanates from the left cerebral hemisphere, the very genesis of

logic and rationality. Does a scientific education develop this

facility more than liberal arts.?

The untroubled domesticity of both sets of TMTs was surprising,

particularly when contrasted to the perceptions of high stress for

top executives. The divorce rates for both sets was less than lo%,

an exact ,@mirroP to that of their parents. This "patterning" continued for the U.R; TMT in terms of social immobility: the British managers come from parents who have already achieved the

higher socio-economic echelons. The reverse situation is to be seen in the U.S. with strong evidence of upward social mobility, thus

supporting the earlier results of Sturdivant & Adler (1976).

Sociologists who contend that movement in British social class

groupings is slow, perpetuating the elite, find support from this

sample (Stanworth & Curran, 1976). Although sibling position failed to differentiate between the two sets, further analysis on a

national-only basis was unsupportive to those scholars who consider

the first or last child to exhibit greater leadership

characteristics than those in the middle order (Hunt, 1979).

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Variables within the section Self-Concept showed a lesser degree of

differentiation between the two sets, and, as a result, support for

many of the propositions was mixed. Those leadership traits as

propounded by Stogdill (1973), Gordon (1976), and Katz and Kahn

(1978) - for example, the high incidence of creativity - were more

strongly supported by the U.K. set as a criterion for management

success than by their U.S. counterparts. Similarly the need to

achieve, so strongly advanced by the Ohio and Michigan Schools

(1950's) as a leadership characteristicc, was significantly weaker

in the U.S. Age also delineated: whereas Hart and Mellons (1970),

Child (1974), and Hambrick and Mason (1984) advanced that

youthfulness would cope better with trading uncertainty, it was the

older British TMT that demonstrated the more appropriate

characteristics for these situations.

Conversely, classifications of managerial style found support on

both sides of the Atlantic: corporate leaders in each country

describing similar methods of managing. This result supports the

behavioural style school (Lickert, 1967: Bowers and Seashore, 1966)

and also the situational school (House, 1971: Hersey and Blanchard,

1977: Yukl, 1981) of leadership theorists.

The differences which emerged within this section of Self-Concept as

to managerial views concerning aspiration levels, and particularly

the desire to replicate their working life, mirrored those results

discussed within the Corporate section. The U.X. TMT appear restless

and continually striving for new challenges: in contrast, the U.S.

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TMT do not. In America, more of the same is perceived to equate

with managerial contentment: in Britain, it does not.

CONCLUSIONS

This research was conducted to test the extent of similarity between

British and American managers at the highest echelon in terms of

their corporate experiences, their domestic and educational

influences, and their self-concept. It was justified on the basis

of lack of knowledge of THT characteristics, a situation of

potentially increasing importance given the level of strategic

commercial activity between these two countries. Whereas prudent interpretation should be exercised given the exploratory nature of

its research, nevertheless the extent of dissimilarity between the

top management characteristics of the two countries is patently

substantial, since of the 40 variables compared, 32 (80%) showed a

significant difference.

The similarity of organisational structures between the largest

companies within the two nations as argued by Wrigley (1971),

Channon (1974), and Child (1974), failed to extend into the

similarity of managerial characteristics. The results from this

sample are less supportive to those of Hofstede (1980) who concluded

that similar cultures would exhibit similar 18clusters1t of managerial

characteristics, but his is a conclusion dependent upon an

assumption of U.S./U.K. cultural similarity. The caveat of

Ajiferuke and Boddewyn (1970), therefore, 'in warning that a single

28

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definition of culture had yet to be agreed between management

scholars appears just as apposite a decade and a half later. If one

contends that U.S. and U.K. cultures are dissimilar, then the views

of Nath (1969) and Davis (1971) that managerial attitudes and values

are functions of a national culture must be supported. Yet a strong

conclusion to this effect would be premature, and it is worthwhile

to consider the alternative views of Negandhils theory relative to

these results. Negandhi (1983) hypothesised that corporate size and

market complexity would be a stronger moderator of managerial values

than national culture. It is not surprising that from this sample,

with its similarity in the industrial/commercial mix and in relative

concentration ratios, that evidence to support this view fails to

emerge. Yet further segmentation of his hypothesis does suggest at

least three areas for future research which may well diminish the

impact of national culture and support his position.

The first would be to relate top management characteristics across

national boundaries, to compare specific industries. Whereas this

research has adopted a ,lhelicopter*f viewpoint - the largest US and

UX companies within their relative domestic economies - it would be

of particular interest to analyse industries in growth or in decline

across a number of countries. Following from this, the second area

would be to relate top management characteristics across national

boundaries, to the financial performance of their relative companies

relative to industry performance. This would extend Hambrick

& Mason's (1984) "upper-echelon II theory on a cross-national basis.

The third development would be to test for significant levels of

29

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difference within companies at-hierarchical points of the

organisation structure. It should thus reveal the existence of

desired success characteristics on an intra-company basis, and again

would lend itself to cross-national comparison.

Imolications for Business

The concept of a corporate *@transatlantic transplant" is clearly not

sustainable: to the business community, the results of this research indicate major differences in both the corporate ,~grooming,, and

self-perceptions of the two top management sets. Given this distinction, any company considering investment positions, joint

ventures, or acquisition in each other's countries, should

critically review these strategic choices--in the light of domestic

managerial perceptions. The Peters & Waterman (1982) US study

already indicates that within a domestic corporate context,

consensus in defining the organisation's "culture" emerged from

shared values, experiences and beliefs. Where this is identifiable, so too is the organisation's financial success. Yet to the American top manager, the British counterpart would appear an antithesis -

personally ambitious, individualistic, and potentially disloyal to '*the company". To the British, the reverse would be perceived - the

American being introverted, needing peer-group reinforcement, a one-

company manager, and rather dull. ,It therefore follows that the

chances for the success of a cross-national strategy should improve

by modifying the normal methods for domestic strategic

implementation relative to the characteristics of those managers who

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will actually carry it out. As Fiedler (1965) reminded us two

decades ago, better to "engineer the job to fit the manageP rather

than the

prior to

other way round. Failure to acknowledge these differences

the .strategic decision may mitigate against the attainment

of potential competitive advantage. Failure to harness these

differences, having made the cross-national strategic decision, may

impinge upon the achievement of the anticipated profit streams which

justified the decision prior to its implementation.

31

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I I SELF-CONCEPT 1 )

I /,,,* ; DOMESTIC ENVIRON

e.g. . occupational views company views

: personal beliefs and habits

I I 1 I CORPORATE ENVIRON I

e.g. . family influences . locational

upbringing . education

e.g. . occupational mobility . functional experience . workloads

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TABLE 1

VARIABLES OPERATIONALISED TO ESTABLISH POTENTIAL DIFFERENCE BETWEEN U.S. AND U.K. TMTs

CORPORATE ENVIRON

Tenure with current company; number of companies worked for; reasons for changing companies.

Functional experiences: starting, predominant, ending. Fastest functional route to the top; run own business.

Workloads; nights away from home; Holidays taken; number of relocations.

DOMESTIC ENVIRON

Education: secondary, university. Subjects studied. Sport at university - team v. individual; importance of winning.

Childhood: region, locality: parental: influence, occupations Siblings f sibling position: Marital: spouse, spouse employment; number of children: Outside interests.

SELF-CONCEPT

Aspiration levels: job replication: patronage effect; mentors; executive success traits; managerial style; perceived company status.

Religion; politics; drink, stress, smoking, sleep habits.

Age

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TABLE 2: CORPORATE ENVIRON

Non-Metric Variables X2 D.F. Significance Level

. Reason for changing companies 19.213

. Career starting function 26.871

. Predominant career area 108.179

. Current career area 107.089

. ggFast-trackgg functions in the 1990's 31.784

. International experience 138.854

. Value of International experience 29.053

l Working week increase 13.840

7 7 7 7

7 1

1 2

0.0075 0.0040 0.0001 0.0001

0.0001 0.0001

0.0001 0.0010

Metric Variables

Means Difference between Means

UK us z Significance Level

n = 418 n = 1,708

. Years tenure with current company

. Number of companies worked for

. Number of hours worked weekly

. Number of nights away from home

. Number of household relocations

. Weeks holiday

17.3 18.6 2.56 0.0050

2.95 2.58 10.9 0.0010

53.2 51.3 4.06 0.0010

46.6 49.9 1.74 0.0409

1.98 2.1 2.76 0.0052 3.77 3.33 4.54 0.001

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TABLE 3: DOMESTIC ENVIRON

Non-Metric Variables X2 D.F. Significance Level

. Parental marital status 13.205 3 0.0042

. Father's occupation 193.26 5

. Mother's occupation 0.0001

52.183 5 0.0001 . Personal marital status 10.937 4 0.0273 . Spouse employment 13.523 2 . Arts vs. science first 0.0012

degree 189.384 2 0.0001 . Postgraduate degree 24.463 2 0.0001

. MBA

. Reason for single parent upbringing

. Birth position

Not significant

Not significant Not significant

Means Difference between Means

Metric Variables UK us z Significance

Level

. Number of siblings

. Number of children 2.6

0.0013

0.0010

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TABLE 4: SELF-CONCEPT

Non-Metric Variables X2 D.F. Significance Level

. Executive success traits 207.852 11 0.0001

. Existence of patronage 3.565 1 0.0590

. Aspiration levels 47.605 1 0.0001

. Same career again 32.357 2 0.0001

. Desired retirement age 17.401 1 0.0001

. Religious beliefs 94.863 3 0.0001

. Drinking habits 54.539 4 0.0001 l Smoking habits 9,956 4 0.0412

. Best to stay in one company Not significant

. Managerial style Not significant

. Influence of first boss Not significant

. Continue if financially independent Not significant

. Sleeping pattern Not significant

Metric Variables

Means Difference between Means

UK us z Significance Levels

. Age 53.9 52.7 2.79 0.0026

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. . -

TABLE 4: CORPORATE ENVIRON

VARIABLES RESULTS

Job-Centred:

Years tenure with current company

Number of companies worked for

Reason for changing companies

Career starting function

Predominant career area

Current career area

Fast-track functions in

ggHvcienegl factors:

. Number of hours worked weekly

. Working week increase

. Number of nights away from home

. Number of household relocations

e Weeks holiday

International exnosure:

. Worked overseas

. Values of international experience

Median range: UK = 16-20; US - 16-20 Mean values: UK - 17.3; US - 18.6 Z-score = 2.56 P(Z > 2.56) ( 0.005 Median values: UK = 3; US = 2 Mean values: UK - 2.95; US = 2.58 Z-score = 10.9 P(Z > 10.9) Chi-square - 19.213, DF = 7

L 0.001

P(X2 2 19.213) = 0.0075 Chlpquare - 26.871, DF - 7 P(x 126.871) = 0.004 ChlZsguare = 108.179, DF = 7 P( 1 108.179) - 0.0001 Ch$-square = 107.089, DF = 7 P(K2 1 107.089) - 0.0001 Chl-square - 31.784, DF = 7 P(x2 2 31.784) -'0.0001

Median range: UK - 51-553 US = 46-50 Mean values: UK - 53.2; US = 51.3 Z-score = Chissguare

4.06 P(Z > 4.06) 1 0.001 - 13.840, DF = 2

P( ii

2 13.840) = 0.001 Me ian range: UK - 31-40; US - 41-50 Mean values: UK 0 46.6; us - 49.9 Z-score = 1.74 P(Z > 1.74) s 0.0409 Median values: UK = 2; US - 2 Mean values: UK = 1.98; US = 2.1 Z-score - 2.76 P(Z > 2.76) IO.0052 Median values: UK - 4; US - 3 Mean values: UK = 3.77; US - 3.33 Z-score = 4.54 P(Z > 4.54) s 0.001

Chi-square - 138.854, DF = 1 P(K2 1 138.854) = 0.0001 Chi-square - 29.053, DF = 1 P(x2 2 29.053) = 0.0001

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TABLE 5: DOMESTIC ENVIRON

VARIABLES RESULTS

Familv Influences:

. Parental marital status

. Parental occupations - Father

- Mother

D Number of brothers

. Current marital status

. Spouse employment

. Number of children

Chi-square - 13.205, DF = 3 P(x2 2 13.205) - 0.0042

Chi-square - 193.26, DF = 5 P(K2 1193.26) - 0.0001 ChaTsquare - 52.183, DF - 5 P(

3 2 52.183) - 0.0001

Me ian values: UK - 1; US - 1 Mean values: UK - 0.87: US - 1.05 Z-score - 3.0 P(Z > 3.0) s 0.0013 Chiyguare - 10.937, DF - 4 P(x 2 10.937) - 0.0273 Chl;square = 13.523, DF - 2 P(

3 2 13.523) - 0.0012

Me ian values: UK - 2; US - 3 Mean values: UK = 2.6: US - 2.9 Z-score = 4.4 P(Z > 4.4) 2 0.001

pducation:

. Undergraduate ChfZsguare 189.384, - DF - 2 - Arts vs. Science

. Postgraduate degree P(x 2 189.384) - 0.0001

= DF = P(x2 Chi-square 24.463, 2 2 24.463) = 0.0001

Page 46: SWP 26/87 CORPORATE LEADERS IN BRITAIN AND AMERICA …points. Farmer f Richman(l985) adopted an external environmental approach and drew attention to the constraints upon managerial

. . l

T A B L E 6 : S E L F - C O N C E P T

V A R IA B L E S R E S U L T S

C o m n a n v V iews:

. E xecu tive success tra i ts C h i -square - 2 0 7 .8 5 2 , D F P(x2 1 2 0 7 .852 ) = 0 .0 0 0 1

- 1 1 . E xiste n c e o f p a tro n a g e to C h i -square = 3 .5 6 5 , D F

P ( X 2 1 3 .565 ) = 0 .0 5 9 0 = 1

Job -V iews :

. A spi ra tio n C h iyquare - 4 7 .6 0 5 , D F = 1 P (zc 2 4 7 .605 ) = 0 .0 0 0 1

. S a m e career a g a i n C h izsguare = 3 2 .3 5 7 , D F - 2 P (X 1 3 2 .357 ) - 0 .0 0 0 1

. Des i red re tire m e n t C h l -square - 1 7 .4 0 1 , D F P ( X 2 1 2 7 .502 ) = 0 .0 0 0 1

= 1

P e rsona l :

. A g e M e d ian r a n g e : U K 5 0 - 5 4 3 U S 5 0 - 5 4 = - M e a n va lues : U K - - 5 3 .9 ; U S 5 2 .7

. R e l ig ion Z-score - 2 .7 9 P (Z - 2 2 .79 ) 0 .0 0 2 6 C h i -square - 9 4 .8 6 3 , D F 3

Dr ink P (x2 1 9 4 .863 ) - 0 .0 0 0 1

- . C h lZsguare - 5 4 .5 3 9 , D F 4 -

P (x 2 5 4 .539 ) - 0 .0 0 0 1 . S m o k e C h l -square - 9 .9 5 6 , D F 4

P ( X 2 1 9 .956 ) - 0 .0 4 1 2 -